How about a few more WaMu updates. The (bad) news seems to keep coming for the Seattle-based bank.
First up, a look back at how WaMu got itself into this mess, courtesy of the Seattle Times: Where WaMu went wrong. This article has its own thread in the forums, so be sure to check that out as well.
Next, take a gander at today’s WaMu headline: Washington Mutual Posts Huge Loss; Director Quits
Washington Mutual, the nation’s largest savings and loan, said Tuesday that it lost $1.14 billion in the first quarter as the struggling economy and flagging real estate values pummeled the bank’s borrowers.
The Seattle-based thrift lost $1.40 per share, compared with a profit of $784 million, or 86 cents per share, in the first quarter a year earlier. It was the bank’s second consecutive quarterly loss.
Washington Mutual also said it needed to set aside $3.5 billion to cover bad loans in its $250 billion portfolio during the first quarter. The bank set aside less than half as much to cover bad loans in the year-ago period.
…
Chairman and chief executive Kerry Killinger promised shareholders that Washington Mutual will turn around within a year.“We will get through this,” Killinger told more than 2,000 shareholders at Seattle’s symphony hall for the bank’s annual meeting Tuesday. “I want people to calm down and have a little faith.”
Killinger outlined the company’s strategy for working through the mortgage crises: aggressive marketing of credit cards, continued growth in services to small businesses, and ongoing improvement in deposits at its retail branches.
Hmm, aggressive marketing of credit cards? Is that really the best way to work your way out of a mess like this? I guess the thinking is that it’s harder for people to “walk away” from credit card debt than from a home loan. Anyway, best of luck to you, WaMu. I have a feeling you’re gonna need it.
(Drew DeSilver, Seattle Times, 04.14.2008)
(Donna Gordon Blankinship, Associated Press, 04.16.2008)